Reconciliations of Non GAAP Financial Measures For the Three and Six Months Ended December 31, 2012 and 2011 1
Non GAAP Metrics Disclosure The Company believes that providing both GAAP and adjusted non GAAP measures of its performance will provide meaningful supplemental information regarding its operational effectiveness and to enhance investors overall understanding of the Company s current financial performance and prospects for the future. Management believes that investors benefit from seeing its results through the eyes of management in addition to the GAAP presentation. It is Managements belief that while not in accordance with or an alternative for GAAP, the adjusted information allows for greater transparency to supplemental information used by management in its financial and operational decision making. The adjusted information excludes items, such as amortization of intangible assets, impairment charges, depreciation, charges to consolidate and integrate recently acquired businesses and non cash stock based compensation, and other non cash charges that may have a material effect on the Company s net income and net income per share in accordance with GAAP. Management monitors these items to ensure that expenses are in line with expectations and that its GAAP results are correctly stated, but does not use them to measure the ongoing bottom line operating performance of the Company. Furthermore, the non GAAP or adjusted information provided by the Company may be different from the non GAAP or adjusted information provided by other companies. 2
Adjusted EBIDTA Reconciliation of GAAP and Non GAAP Financial Measures For the Three Months Ended For the Six Months Ended (In $000's) December 31, December 31, Audited results of operations 2012 2011 2012 2011 Net Income (loss) $ (64) $ (176) $ 141 $ (456) Adjusted EBITDA Reconciliation Adjustments: Depreciation and amortization 230 221 460 445 Bad debt expense 27 70 Interest, net 34 47 77 120 Stock based compensation 290 310 525 563 One time expenses (stock and cash) 60 Adjusted EBITDA $ 490 $ 429 $ 1,203 $ 802 50% 3
Non GAAP Earnings Per Share Reconciliation of GAAP and Non GAAP Financial Measures For the Three Months Ended For the Six Months Ended (In $000's, except per share) December 31, December 31, Audited results of operations 2012 2011 2012 2011 Net Income (loss) $ (64) $ (176) $ 141 $ (456) Non GAAP Net Income (loss) Reconciliation Adjustments: Stock based compensation 290 310 525 563 One time expenses (stock and cash) 35% 119% 60 Acquisition related amortization (1) 126 126 252 252 Adjusted Non GAAP Net Income (loss) $ 352 $ 260 $ 918 $ 419 Preferred Dividends (289) (209) (499) (417) Adjusted Non GAAP Net income to Common Shareholders $ 63 $ 51 $ 419 $ 2 Weighted average shares, diluted 12,303,000 11,698,000 12,259,000 11,674,000 Adjusted Non GAAP EPS, diluted $ 0.01 $ 0.00 $ 0.03 $ 0.00 4
Non GAAP Free Cash Flow Reconciliation of GAAP and Non GAAP Financial For the Three Months Ended For the Six Months Ended (In $000's) December 31, December 31, Audited results of operations 2012 2011 2012 2011 Net cash provided by operating activities $ 608 $ 448 $ 879 $ 392 Non GAAP Free Cash Flow Reconciliation Adjustments: Purchase of property and equipment (17) (34) (66) (54) Adjusted Free Cash Flow $ 591 $ 414 $ 813 $ 338 43% 141% Free cash flow includes net cash provided by operating activities less replacement purchases and equipment. Capital expenditures related to long term investments and new technology developments are omitted. During 2Q13 the Company invested $232,000 in leasehold improvements for its new corporate headquarters located in Salt Lake City, UT, this amount is excluded from the Free Cash Flow calculation. 5
Non GAAP Net Debt Reconciliation of GAAP and Non GAAP Financial (In $000's) As of December 31, Audited results of operations 2012 2011 Total Debt $ 2,411 $ 3,173 Non GAAP Free Cash Flow Reconciliation Adjustments: Less: Total Cash 1,111 942 Non GAAP Net Debt $ 1,300 $ 2,231 36% 42% 6
Contact Information For more information, please contact: Edward Clissold, CFO Park City Group, Inc. eclissold@parkcitygroup.com 435-645-2000 Randy Fields, Chairman, CEO Park City Group, Inc. randy@parkcitygroup.com 435-645-2000 7